Construction of new homes rises but still lags behind demand

Apartment construction remains slow, CSO figures show

So far this year 12,582 new properties have been built, an increase of 27.7 per cent on the first nine months of 2017.

The volume of new homes built in the Republic is continuing to increase but still remains far below the level of demand, figures from the Central Statistics Office (CSO) show.

So far this year 12,582 new properties have been built, an increase of 27.7 per cent on the first nine months of 2017 when 9,856 properties were completed.

Although the trend is positive, the total is considerably lower than the estimated 30,000 homes needed every year to service demand in the property market. However, Davy economist Conall Mac Coille estimates that about 18,000 properties will be completed by the end of the year.

Friday’s figures from the CSO show the volume of apartment construction remains poor, with fewer apartments built in the third quarter than in the same period last year, totalling 644. So far this year, apartment construction has comprised about 13 per cent of the total number of new builds. In other European countries apartments typically account for 30-50 per cent of the housing stock.

Mr Mac Coille said apartment completions should begin to “grow rapidly given a surge of planning permissions in recent years”.

Meanwhile, the figures show 2,821 properties as part of a development were built while the number of single, or one-off, homes increased by 6.8 per cent to 1,208.

While the rise in the volume of new home completions appears sharp, it is slower than the 26 per cent annual growth in the first quarter and 34 per cent in the second quarter, Mr Mac Coille flagged.

The “new dwelling completions” data from the CSO is primarily based on data from ESB. However, as that overstates new dwellings, the CSO utilises other sources to enhance the data.

Urban completions

The figures detail that the vast majority of new completions were in urban areas, with 21.3 per cent of new properties in rural areas, a figure that has fallen since last year.

With 1,872 new properties in the quarter, Dublin had the highest level of new completions, followed by the mid-east region. Within the State, the Eircode area with the most new properties was Dublin 15 (206) followed by W91 Naas (173) and C15 Navan (157).

“The country needs more houses. This is an unquestionable truth. So we need to put in place the supports, process, incentives and structures that will enable the goal of greater construction output to be achieved,” he added.

While the CSO doesn’t classify output in the student accommodation sector into “dwellings”. Its data shows that 2,447 bed spaces were created in the third quarter which brings the total completed since the second quarter of 2016 to 5,531.